Today's Outrage: Ready for the Worst at Citigroup
Updated from 1:03 p.m. EDT
Hot on the heels of the February restructuring that gave the U.S. government 36% of
Citigroup
(C) - Get Report
, more plans are being hatched to
, according to
The Wall Street Journal
.
It's all off-the-record stuff with no sources named, and it's supposedly worst-case scenario planning -- just in case something unexpectedly bad happens. No one is saying they expect something bad to happen. The unnamed U.S. officials just want to be ready.
Meanwhile, Citi CEO Vikram Pandit tried to reassure his staff Monday that everything is fine, except the bank's share price of $1 and change.
Citi's worth much more
than that, according to Pandit, and the bank has been profitable in the first two months of 2009.
So don't read too much into all this chatter about another rescue initiative. It's all good.
If there was something to tell, you can rest assured that you'll find out eventually. You know, after it's been done and the government completely controls Citi and whatever shares you own are worth even less.
Forgive me for being pessimistic, but this bank doesn't exactly inspire confidence these days.
While Citi's stock is rising today -- closing 38.1% higher at $1.45 -- it remains among the cheapest of the major banks.
Bank of America
(BAC) - Get Report
closed at $4.79, a gain of 27.7%,
Wells Fargo
(WFC) - Get Report
added 18.5% to close at $11.81,
U.S. Bancorp
(USB) - Get Report
rose 11.9% to close at $11.40 and
JPMorgan Chase
(JPM) - Get Report
closed 22.6% higher at $19.50.
Traders on our sister site,
, say
Citi's stock is no better than a lottery ticker.
In fact, one investor said it's more like a discarded scratch-off lottery stub that shows it's already a loser.
So it's not just me, folks.
If the government thinks it's wise to be ready for the worst, investors should be too.
Hall is the editor of
TheStreet.com
. Previously, he served as deputy editor and chief innovation officer at
The Orange County Register
and as a news manager at
Bloomberg News
in Frankfurt, Amsterdam and Washington, D.C. As a reporter, he covered business and financial markets, worked in both print and television in the U.S. and Europe, and conducted in-depth investigative coverage at
The Journal-Gazette
in Fort Wayne, Ind. His work also has been published in a variety of newspapers including
The Wall Street Journal
,
The New York Times
and
International Herald Tribune
. Hall received a bachelor�s degree in journalism and political science from The Ohio State University and has taken graduate management science courses at Boston University.
